City of Cincinnati

As streetcar construction nears Government Square, utility relocation and renewal will close the bus hub from 7:00 a.m. to 3:30 p.m., starting Tuesday, February 25. This construction is expected to take several days.

All Metro routes currently served at the stops A, B and C (Rts. 11, 33, 17, 19, 24, 46, 43) will be moved to Area E on Fifth Street. Signs will notify Metro riders of pick up and drop off locations. Metro will have extra employees stationed at Government Square to help riders and a police officer will direct traffic during the construction.

Located on Fifth Street between Walnut and Main Streets, Government Square is Metro’s largest transit hub. More than 15,000 people use Government Square each weekday.

Messer, Prus, Delta (MPD), constructor of the Cincinnati Streetcar, today reported they have met their inclusion goal of the project, awarding 18% of construction contracts to Disadvantaged Business Enterprises (DBEs). A DBE is defined as a small business owned and operated by minorities or women. recognized as socially and economically disadvantaged individuals.

The contracts total more than $12.5 million to nine companies with DBE certification. MPD is building the 3.6-mile streetcar loop with total construction costs estimated at $70 million.

The streetcar project receives money from the federal government as well as local sources, and therefore, the project must use a DBE goal rather than a Small Business Enterprise (SBE) goal as seen in other locally-funded building projects.

The DBE goal for the civil construction contract for the streetcar project is 18%. The goal was based on an analysis of the highly-specialized scopes of work outlined in the construction contract, and available registered DBEs in the area. Disadvantaged businesses are involved in many areas of the construction, including: preparing streets for rail,building the Maintenance & Operations Facility, installing the street signalization and poles, and the station stops.

“MPD is committed to inclusion and we are pleased to have met the 18% DBE goal for construction contracts,” said Mark Luegering, senior vice president of Messer Construction Co. “We sought-out disadvantaged businesses during the bid period and award of contracts to play a significant role in construction and are pleased with the quality of our subcontractors.”

For those who have read the Cincinnati Enquirer’s Sunday Editorial, “Streetcar: Stop,” there are quite a few inaccuracies surrounding the financing plan and operations plan. Please help us spread the correct information.

The Enquirer wrote: “The budget now plans for $14 million to come from a pool of money created by tax revenue generated by property improvements to The Banks.” This is wrong.

The editorial refers to what’s commonly called a Tax Increment Financing (TIF) district. The plan had always been for part of the streetcar financing to come from the Downtown South/Riverfront TIF District — this is nothing new.

And $11 million will still come from the Downtown South/Riverfront TIF District, but not The Banks — The Banks project generates its own revenue that goes back into The Banks.

Rather, the City has changed the source of funds for repaying $14 million of the $25 million in notes issued as part of the original financing proposal for the streetcar project.

The substitution source for the $14 million is the Urban Redevelopment Tax Increment Equivalent Fund, which was established in 1995 to collect service payments from the Westin/Star, Hyatt and Saks. This fund was not currently committed to any project. The City’s Finance Department will commission a study to determine the current valuation of the Downtown South TIF, but because we need to issue the bonds, we will use this as the source in the interim.

When the Downtown South TIF District rebounds because of growth projects both within and surrounding the district — like the Casino, The Banks, Dunnhumby, Omnicare and the Streetcar — the City will look at the Downtown South TIF District as a funding source once again.

Projects the Enquirer referred to that need funding such as a police district on the West side and the Smale Riverfront Park were already passed by Council in June and are happening.

The Enquirer wrote: “Mayor Mallory and City Manager Dohoney are counting on growth and development along the streetcar route to cover the $3 million or more each year that it costs to operate it.” This is patently wrong.

The City has publicly said again and again that the operating costs will come from sponsorships, fare box revenue and up to $3 million of casino revenue. Even baseline projections show that the casino will generate that and is a viable source precisely because property valuations lag actual investment.